Operating net income was $3.0 million, or $0.13 per diluted share,
compared to $2.7 million, or $0.12 per share, for the third quarter of
2011. For the nine months ended September 30, 2012, operating net
income was $10.6 million, or $0.46 per share, compared to $13.9
million, or $0.61 per share, for the nine months ended September 30,
2011.

Excluding the financial impact of gains recognized by JMP Credit
Corporation on the sale or payoff of loans initially acquired in April
2009, adjusted operating net income was $0.13 per diluted share, an
increase of 30.0% from $0.10 per share for the third quarter of 2011.
For the nine months ended September 30, 2012, adjusted operating net
income was a record $0.44 per share, an increase of 7.3% from $0.41
per share for the nine months ended September 30, 2011. For more
information on operating net income and adjusted operating net income,
including a reconciliation to net income, please see the section below
titled “Non-GAAP Financial Measures.”

The net loss attributable to JMP Group under generally accepted
accounting principles, or GAAP, was $1.7 million, or $0.07 per diluted
share, compared to a net loss of $1.6 million, or $0.07 per share, for
the third quarter of 2011. For the nine months ended September 30,
2012, the net loss was $2.9 million, or $0.13 per share, compared to
net income of $3.4 million, or $0.15 per share, for the nine months
ended September 30, 2011.

Adjusted net revenues, which exclude certain non-cash items and
non-controlling interests, were $28.8 million, compared to $28.1
million for the third quarter of 2011. For the nine months ended
September 30, 2012, adjusted net revenues were $91.7 million, compared
to $109.6 million for the nine months ended September 30, 2011.
Further excluding net gains or losses on the sale or payoff of
acquired loans, adjusted net revenues would have been $28.4 million
and $90.7 million for the quarter and nine months ended September 30,
2012, respectively, and $27.1 million and $96.7 million for the
quarter and nine months ended September 30, 2011, respectively. For
more information on adjusted net revenues, including a reconciliation
to net revenues, please see the section below titled “Non-GAAP
Financial Measures.”

Total net revenues on a GAAP basis were $18.1 million and $76.1
million for the quarter and nine months ended September 30, 2012,
respectively, compared to $17.4 million and $91.7 million for the
quarter and nine months ended September 30, 2011, respectively.

“We had a better-than-expected third quarter as a result of increased
equity capital markets activity and good overall performance in our
hedge funds,” said Chairman and Chief Executive Officer Joe Jolson. “JMP
Group posted adjusted operating EPS—which excludes profits on the sale
of acquired loans—of $0.13, up 30% from the third quarter of last year.
Despite depressed institutional equity underwriting and trading volumes
that have persisted across Wall Street for much of 2012, JMP remains on
track to produce a second consecutive year of record earnings,
generating $0.44 of adjusted operating EPS for the first nine months of
2012, compared to $0.41 for the same period in 2011. We continue to be
cautiously optimistic heading into the fourth quarter, with increased
ECM market share, a healthy backlog of advisory revenues, and growth
initiatives underway at our three operating platforms.”

Revenues

Investment Banking

Investment banking revenues were $12.2 million, an increase of 21.6%
from $10.0 million for the third quarter of 2011. For the nine months
ended September 30, 2012, investment banking revenues were $38.0
million, a decrease of 5.8% from $40.3 million for the nine months ended
September 30, 2011.

A statement of the company's investment banking revenues and transaction
counts for the quarter and nine months ended September 30, 2012 and for
comparable prior periods is set forth below.

Quarter Ended

Nine Months Ended

Sept. 30, 2012

June 30, 2012

Sept. 30, 2011

Sept. 30, 2012

Sept. 30, 2011

($ in thousands)

Count

Revenues

Count

Revenues

Count

Revenues

Count

Revenues

Count

Revenues

Public equity

28

$

9,297

16

$

6,729

13

$

7,280

67

$

25,050

53

$

25,684

Debt and convertible securities

3

293

5

642

1

441

13

2,393

7

6,266

Private capital markets and other

2

989

3

1,047

-

249

7

4,236

5

3,729

Strategic advisory

3

1,639

1

715

3

2,078

9

6,331

10

4,653

Total

36

$

12,218

25

$

9,133

17

$

10,048

96

$

38,010

75

$

40,332

Brokerage

Net brokerage revenues were $5.4 million, a decrease of 22.1% from $6.9
million for the third quarter of 2011, although approximately in line
with the second quarter's total. For the nine months ended September 30,
2012, net brokerage revenues totaled $16.3 million, a decrease of 16.0%
from $19.4 million for the nine months ended September 30, 2011.

Asset Management

Asset management fees and other related revenues were $4.7 million, a
decrease of 31.9% from $6.9 million for the third quarter of 2011. For
the nine months ended September 30, 2012, asset management fees and
other related revenues were $15.5 million, a decrease of 14.2% from
$18.0 million for the nine months ended September 30, 2011. For more
information on asset management-related fee revenues, please see the
section below titled “Non-GAAP Financial Measures.”

Client assets under management at September 30, 2012 totaled $1.2
billion, including $726.7 million of funds managed by Harvest Capital
Strategies and $471.0 million par value of loans and cash underlying the
collateralized loan obligation managed by JMP Credit Advisors. Client
assets under management were $1.2 billion at June 30, 2012 and $1.3
billion at September 30, 2011. Including sponsored funds, client assets
under management totaled $1.7 billion at September 30, 2012, compared to
$1.6 billion at June 30, 2012 and $2.4 billion at September 30, 2011.

Principal transactions generated net realized and unrealized losses of
$2.0 million, compared to net losses of $6.3 million for the third
quarter of 2011. For the nine months ended September 30, 2012, principal
transactions generated net realized and unrealized gains of $12.3
million, compared to net losses of $0.1 million for the nine months
ended September 30, 2011.

A statement of the company's principal transaction revenues for the
quarter and nine months ended September 30, 2012 and for comparable
prior periods is set forth below.

Of the $2.0 million in net losses for the quarter ended September 30,
2012, a loss of $3.0 million was attributable to a non-controlling
interest in net realized and unrealized losses at Harvest Growth
Capital, a venture capital fund managed by Harvest Capital Strategies
that is consolidated under GAAP. GAAP accounting requires that JMP Group
consolidate Harvest Growth Capital due to Harvest Capital Strategies'
role as the fund's manager and managing member, despite the company's
ownership of just 4.6% of the fund. The presentation of adjusted net
revenues elsewhere in this press release excludes JMP Group's
non-controlling interest in Harvest Growth Capital; and, accordingly,
the aforementioned loss of $3.0 million is not included in adjusted net
revenues. Net of its non-controlling interest, JMP Group had a net
realized and unrealized loss of $0.1 million on its investment in
Harvest Growth Capital for the quarter. For more information on adjusted
net revenues, including a reconciliation to net revenues, please see the
section below titled “Non-GAAP Financial Measures.”

Gain on Sales and Payoffs of Loans and Loan Loss Provision

JMP Credit Corporation realized a net gain of $0.2 million due to a
mark-to-market adjustment on a loan held for sale in addition to the
sale or payoff of 28 of the loans in its portfolio, compared to a net
gain of $1.4 million in connection with 20 loans for the third quarter
of 2011. For the nine months ended September 30, 2012, the net realized
gain amounted to $2.6 million as a result of the sale or payoff of 67
loans, compared to a net gain of $15.0 million in connection with 90
loans for the nine months ended September 30, 2011. For the quarter and
nine months ended September 30, 2012, net realized gains of $0.5 million
and $2.0 million, respectively, were due to the sale or payoff of loans
acquired with JMP Credit in April 2009, compared to net realized gains
of $1.0 million and $13.0 million, respectively, for the quarter and
nine months ended September 30, 2011. At September 30, 2012, eight loans
with an aggregate par value of $30.2 million and an associated liquidity
discount of $6.5 million remained from the portfolio acquired in April
2009.

A net loan loss provision of $0.1 million was recorded for the quarter
as a general reserve in connection with performing loans at JMP Credit
and Harvest Capital Credit, both of which are currently consolidated
under GAAP. At September 30, 2012, general loan loss reserves equaled
0.7% of gross performing loans, compared to 0.4% at September 30, 2011.

Other income was $0.4 million, compared to $1.0 million for the third
quarter of 2011. For the nine months ended September 30, 2012, other
income was $3.5 million, compared to $2.5 million for the nine months
ended September 30, 2011.

Net Interest Income

Interest income was $8.3 million, and interest expense was $10.1
million, resulting in net interest expense of $1.8 million, compared to
net interest expense of $1.6 million for the third quarter of 2011.
Excluding net amortization expense related to liquidity discounts, net
interest income was $5.7 million, compared to $4.8 million for the third
quarter of 2011. The year-over-year increase was due to the launch of
Harvest Capital Credit in September 2011 and the subsequent deployment
of a portion of its committed capital. The net amortization expense,
which reduced third quarter EPS by approximately $0.19, is expected to
be extinguished in May 2013. For the nine months ended September 30,
2012, net interest expense was $5.5 million, compared to net interest
expense of $0.7 million for the nine months ended September 30, 2011;
excluding net interest expense due to net amortization of liquidity
discounts, net interest income was $16.1 million and $16.2 million,
respectively, for the same periods.

Expenses

Compensation and Benefits

Compensation and benefits expense was $17.4 million, compared to $16.0
million for the third quarter of 2011. For the third quarter of 2012,
non-cash compensation expense attributable to performance-related and
other restricted stock units, or RSUs, granted subsequent to JMP Group's
May 2007 initial public offering was $0.2 million, compared to $0.1
million for the third quarter of 2011.

For the nine months ended September 30, 2012, compensation and benefits
expense was $55.8 million, compared to $66.2 million for the nine months
ended September 30, 2011. For the nine months ended September 30, 2012,
there was no non-cash compensation expense attributable to RSUs granted
in connection with the company's IPO, as the expense completely
amortized in the first half of 2011 with the vesting of the final
tranche of IPO-related RSUs. For the nine months ended September 30,
2011, non-cash compensation expense attributable to IPO-related RSUs was
$0.8 million. For the nine months ended September 30, 2012, non-cash
compensation expense attributable to performance-related and other RSUs
granted subsequent to the company's IPO was $0.6 million, compared to
$0.4 million for the nine months ended September 30, 2011.

As a percentage of adjusted net revenues, compensation and benefits
expense was 60.2% for the quarter, compared to 56.8% for the third
quarter of 2011, and was 60.9% for the nine months ended September 30,
2012, compared to 60.4% for the nine months ended September 30, 2011.
Excluding the cost of RSU grants, compensation and benefits expense was
59.5% of adjusted net revenues for the quarter, compared to 56.4% for
the third quarter of 2011, and was 60.2% for the nine months ended
September 30, 2012, compared to 59.4% for the nine months ended
September 30, 2011.

Non-Compensation Expense

Non-compensation expense was $6.3 million, compared to $7.5 million for
the third quarter of 2011. For the nine months ended September 30, 2012,
non-compensation expense was $17.9 million, compared to $20.2 million
for the nine months ended September 30, 2011. As a percentage of
adjusted net revenues, non-compensation expense was 21.8% for the
quarter, compared to 26.8% for the third quarter of 2011, and was 19.6%
for the nine months ended September 30, 2012, compared to 18.4% for the
nine months ended September 30, 2011.

Personnel

At September 30, 2012, the company had 217 full-time employees, compared
to 214 at the end of the prior quarter and 215 at September 30, 2011.

Non-GAAP Financial Measures

In addition to the GAAP financial results presented in this press
release, JMP Group presents the non-GAAP financial measures discussed
below. These non-GAAP measures are provided to enhance investors'
overall understanding of the company's current financial performance.
Additionally, company management believes that this presentation enables
meaningful comparison of JMP Group's financial performance in various
periods. However, the non-GAAP financial results presented should not be
considered a substitute for results that are presented in a manner
consistent with GAAP. A limitation of the non-GAAP financial measures
presented is that the adjustments concern gains, losses or expenses that
JMP Group expects to continue to recognize; the adjustment of these
items should not be construed as an inference that these gains or
expenses are unusual, infrequent or non-recurring. Therefore, company
management believes that both JMP Group's GAAP measures of its financial
performance and the respective non-GAAP measures should be considered
together. The non-GAAP measures presented herein may not be comparable
to similarly titled measures presented by other companies.

base management and incentive fees earned by Harvest Capital
Strategies as manager of Harvest Growth Capital, a venture capital
fund, and Harvest Capital Credit, a small business lending strategy;
Harvest Capital Strategies is managing member of Harvest Growth
Capital and the external manager of Harvest Capital Credit; and, as a
result of its ownership of each, JMP Group consolidates both entities
in accordance with GAAP accounting standards and eliminates the fees
in consolidation; presenting these fees as though Harvest Growth
Capital and Harvest Capital Credit were deconsolidated presents the
entities' results in a manner similar to those of the other investment
funds managed by Harvest Capital Strategies;

the non-cash net amortization of liquidity discounts at JMP Credit,
due to scheduled contractual principal repayments, of $7.5 million and
$21.6 million for the quarter and nine months ended September 30,
2012, respectively;

non-cash amortization, in connection with an intangible asset, of $0.1
million per quarter in certain periods prior to the quarter ended
September 30, 2011;

non-cash general loan loss provisions of $0.1 million and $0.7 million
taken with regard to Harvest Capital Credit for the quarter and nine
months ended September 30, 2012, respectively;

unrealized mark-to-market gains or losses on the company's strategic
equity investments as well as certain warrant positions; and

the non-controlling interest in net unrealized gains and losses
generated by Harvest Growth Capital, of which Harvest Capital
Strategies is manager and managing member; under GAAP, JMP Group
consolidates the fund; however, as presented, unrealized gains and
losses that do not accrue to the company are reversed.

Additionally, management considers it instructive to further adjust the
company's adjusted net revenues to exclude the financial impact of gains
or losses recognized by JMP Credit Corporation due to the sale or payoff
of loans originally included in the portfolio acquired by JMP Group in
April 2009.

A reconciliation of JMP Group's net revenues to its adjusted net
revenues for the quarter and nine months ended September 30, 2012 and
for comparable prior periods is set forth below.

Adjustments to reflect economic contributions from Harvest Growth
Capital and Harvest Capital Credit as though deconsolidated for
purposes of financial reporting; upon deconsolidation, fee revenues
and dividend payments would be recognized, while net interest income
and other revenues generated by the two entities would not be
recorded by JMP Group.

Company management has utilized adjusted net revenue, adjusted in the
manner described above, as an additional device to aid in understanding
and analyzing JMP Group's financial results for the periods presented.
Management believes that adjusted net revenues provide useful
information by excluding non-cash additions to and deductions from total
net revenues as well as non-controlling interests and loan sale gains or
losses that may otherwise obscure the company's operating revenues and
complicate an assessment of the company's core business activities.
Management believes that adjusting net revenue in these ways is useful
in that it allows for a better evaluation of the performance of JMP
Group's ongoing business and facilitates a meaningful comparison of the
company's results in a given period to those in prior and future periods.

A statement of JMP Group's asset management-related fee revenues for the
quarter and nine months ended September 30, 2012 and for comparable
prior periods is set forth below.

Quarter Ended

Nine Months Ended

(in thousands)

Sept. 30, 2012

June 30, 2012

Sept. 30, 2011

Sept. 30, 2012

Sept. 30, 2011

Base management fees:

Fees reported as asset management fees

$

2,195

$

2,462

$

2,519

$

7,094

$

7,108

Fees reported as other income

339

606

937

1,654

1,923

Fees earned at Harvest Growth Capital and Harvest Capital Credit

275

241

203

717

609

Total base management fees

2,809

3,309

3,659

9,465

9,640

Incentive fees:

Fees reported as asset management fees

1,560

1,030

3,175

3,627

7,785

Fees reported as other income

-

-

29

-

381

Fees earned at Harvest Growth Capital and Harvest Capital Credit

322

112

-

564

-

Total incentive fees

1,882

1,142

3,204

4,191

8,166

Other fee income:

Fundraising fees

26

26

60

79

232

New York Mortgage Trust termination fee

-

1,735

-

1,735

-

Total other fee income

26

1,761

60

1,814

232

Asset management-related fee revenues:

All fees reported as asset management fees

3,755

3,492

5,694

10,721

14,893

All fees reported as other income

365

2,367

1,026

3,468

2,536

All fees earned at Harvest Growth Capital and Harvest Capital
Credit

597

353

203

1,281

609

Total asset management-related fee revenues

$

4,717

$

6,212

$

6,923

$

15,470

$

18,038

Company management has utilized asset management-related fee revenue as
a means of assessing the performance of JMP Group's combined asset
management activities, including its fundraising and other services for
third parties. Management believes that asset management-related fee
revenues, as presented above, provide useful information by indicating
the relative contributions of base management fees and
performance-related incentive fees, thus facilitating a comparison of
those fees in a given period to those in prior and future periods.
Management also believes that asset management-related fee revenue is a
more meaningful measure than standalone asset management fees as
reported, because asset management-related fee revenues represent the
combined impact of JMP Group's various asset management activities on
the company's total net revenues.

Operating Net Income

Operating net income is a non-GAAP financial measure that (i) reverses
stock-based compensation expense related to equity awards granted both
at the time of JMP Group's May 2007 initial public offering and
thereafter, (ii) excludes the net amortization of liquidity discounts on
loans held and asset-backed securities issued by JMP Credit Corporation,
(iii) excludes amortization expense related to an intangible asset, (iv)
reverses loan loss provisions taken in connection with Harvest Capital
Credit, (v) reverses net unrealized gains and losses on strategic equity
investments and warrants, and (vi) assumes an effective tax rate of 42%.
In particular, operating net income adjusts for:

the grant of 1,931,060 restricted stock units, or RSUs, at the time of
the company's IPO, resulting in non-cash compensation expense in
periods prior to the quarter ended September 30, 2011;

the grant of RSUs subsequent to the company's IPO, which resulted in
non-cash compensation expense of $0.2 million and $0.6 million for the
quarter and nine months ended September 30, 2012, respectively;

the non-cash net amortization of liquidity discounts at JMP Credit,
due to scheduled contractual principal repayments, of $7.5 million and
$21.6 million for the quarter and nine months ended September 30,
2012, respectively;

non-cash amortization, in connection with an intangible asset, of $0.1
million per quarter in certain periods prior to the quarter ended
September 30, 2011;

non-cash general loan loss provisions of $47,000 and $0.3 million,
after non-controlling interest, for the quarter and nine months ended
September 30, 2012 taken with regard to Harvest Capital Credit;

unrealized mark-to-market gains or losses on the company's strategic
equity investments as well as certain warrant positions; and

a combined federal, state and local income tax rate of 42%.

Reconciliations of JMP Group's net income to its operating net income
for the quarter and nine months ended September 30, 2012 and for
comparable prior periods are set forth below.

Company management has utilized operating net income on a total and per
share basis, adjusted in the manner described above, as an additional
device to aid in understanding and analyzing JMP Group's financial
results for the periods presented. Management believes that operating
net income provides useful information by excluding certain items that
may not be representative of the company's core operating results or
core business activities. Management also believes that operating net
income is a useful measure because it allows for a better evaluation of
the performance of JMP Group's ongoing business and facilitates a
meaningful comparison of the company's results in a given period to
those in prior and future periods.

Adjusted Operating Net Income

Adjusted operating net income excludes from operating net income the
financial contribution of gains or losses recognized by JMP Credit
Corporation due to the sale or payoff of loans originally included in
the portfolio acquired by JMP Group in April 2009. Management believes
that this metric can be instructive to investors who wish to assess the
company's core earnings over time without regard to a relatively
volatile revenue stream. By excluding profits from sales and payoffs of
acquired loans, management intends to represent the earnings power of
the company's core businesses and ongoing operations. Moreover, the
company utilizes adjusted operating net income as a threshold for the
vesting of its performance-related RSUs.

Reconciliations of JMP Group's operating net income to its adjusted
operating net income for the quarter and nine months ended September 30,
2012 and for comparable prior periods are set forth below.

Quarter Ended

(in thousands, except per share amounts)

Sept. 30, 2012

June 30, 2012

Sept. 30, 2011

Operating net income

$

3,036

$

3,000

$

2,670

Add back:

Income tax expense (assumed rate of 42%)

2,198

2,172

1,934

Operating income before taxes

5,234

5,172

4,604

Subtract:

Earnings/(loss) from gains on loan portfolio acquired

269

(110

)

596

Adjusted operating income before taxes

4,965

5,282

4,008

Income tax expense (assumed rate of 42%)

2,085

2,218

1,683

Adjusted operating net income

$

2,880

$

3,064

$

2,325

Adjusted operating net income per share:

Basic

$

0.13

$

0.13

$

0.10

Diluted

$

0.13

$

0.13

$

0.10

Weighted average shares outstanding:

Basic

22,737

22,772

22,354

Diluted

22,830

22,859

22,493

Nine Months Ended

(in thousands, except per share amounts)

Sept. 30, 2012

Sept. 30, 2011

Operating net income

$

10,561

$

13,902

Add back:

Income tax expense (assumed rate of 42%)

7,647

10,067

Operating income before taxes

18,208

23,969

Subtract:

Earnings from gains on loan portfolio acquired

584

7,775

Adjusted operating income before taxes

17,624

16,194

Income tax expense (assumed rate of 42%)

7,402

6,801

Adjusted operating net income

$

10,222

$

9,393

Adjusted operating net income per share:

Basic

$

0.45

$

0.42

Diluted

$

0.44

$

0.41

Weighted average shares outstanding:

Basic

22,564

22,152

Diluted

22,977

22,634

Segment Reporting

In order to demonstrate the contribution to the company's results of
each of its primary businesses on a standalone basis, JMP Group presents
the operating net income generated by each segment in the tables that
follow. Management believes that these presentations enable investors to
better understand the separate but interrelated financial operations of
the company's various business lines and to more accurately assess the
contribution of each to JMP Group's aggregate results.

Total net revenues have been adjusted, in part, as detailed above in the
section titled “Adjusted Net Revenue,” and the resulting adjusted net
revenues (i) include asset management fees, net interest income or
expense, and other revenues eliminated upon the consolidation of Harvest
Growth Capital and Harvest Capital Credit, (ii) exclude the net
amortization of liquidity discounts on loans held and asset-backed
securities issued by JMP Credit Corporation, (iii) exclude amortization
expense related to an intangible asset, (iv) reverse loan loss
provisions taken in connection with Harvest Capital Credit; (v) reverse
net unrealized gains and losses on strategic equity investments and
warrants and (vi) exclude non-controlling interests in net unrealized
gains and losses on Harvest Growth Capital. Total non-interest expenses
have been adjusted, in part, as detailed above in the section titled
“Operating Net Income,” and the resulting adjusted non-interest expense
reverses stock-based compensation expense related to equity awards
granted both at the time of JMP Group's May 2007 initial public offering
and thereafter. For the purposes of calculating operating net income, an
effective tax rate of 42% is assumed.

Statements of JMP Group's operating net income on a segment basis for
the quarter and nine months ended September 30, 2012 are set forth below.

Reverses net unrealized gains and losses on strategic equity
investments and warrants and excludes non-controlling interests in
net realized and unrealized gains and losses related to Harvest
Growth Capital as well as other principal transaction revenues
related to Harvest Capital Credit; net realized and unrealized
losses totaling $3.0 million are recognized upon consolidation of
the entities.

(3)

Excludes expense related to the non-cash net amortization of
liquidity discounts at JMP Credit Corporation and amortization
expense related to an intangible asset.

(4)

Excludes general loan loss provision at Harvest Capital Credit in
the amount of $0.1 million.

Excludes non-controlling interests totaling $3.1 million in the net
realized and unrealized losses of Harvest Growth Capital and Harvest
Capital Credit that are recognized upon consolidation of the
entities.

Reverses net unrealized gains and losses on strategic equity
investments and warrants and excludes non-controlling interests in
net realized and unrealized gains and losses related to Harvest
Growth Capital as well as other principal transaction revenues
related to Harvest Capital Credit; net realized and unrealized gains
totaling $6.8 million are recognized upon consolidation of the
entities.

(3)

Excludes expense related to the non-cash net amortization of
liquidity discounts at JMP Credit Corporation and amortization
expense related to an intangible asset.

(4)

Excludes general loan loss provision at Harvest Capital Credit in
the amount of $0.7 million.

Excludes non-controlling interests totaling $6.8 million in the net
realized and unrealized gains of Harvest Growth Capital and Harvest
Capital Credit that are recognized upon consolidation of the
entities.

Adjusted Tangible Book Value per Share

At September 30, 2012, JMP Group's tangible book value per share was
$5.32, compared to $5.43 at June 30, 2012 and $5.80 at September 30,
2011. Adjusting book value to reflect the net liquidity discount on JMP
Credit Corporation's loan portfolio and asset-backed securities issued,
JMP Group's adjusted tangible book value per share at September 30, 2012
would have been $4.86, as indicated by the table below.

During the quarter ended September 30, 2012, JMP Group repurchased
approximately 59,000 shares of its common stock at an average price of
$5.57 per share, or $0.3 million in total. At quarter-end, approximately
400,000 shares remained eligible for repurchase under the company's
existing repurchase authorization.

Cautionary Note Regarding Quarterly Financial Results

Due to the nature of its business, JMP Group's quarterly revenues and
net income may fluctuate materially depending on: the size and number of
investment banking transactions on which it advises; the timing of the
completion of those transactions; the size and number of securities
trades which it executes for brokerage customers; the performance of its
asset management funds and inflows and outflows of assets under
management; gains or losses stemming from sales of or prepayments on, or
losses stemming from defaults on, loans underlying the company's
collateralized loan obligation or in its small business lending
portfolio; and the effect of the overall condition of the securities
markets and economy as a whole. Accordingly, revenues and net income in
any particular quarter may not be indicative of future results.
Furthermore, JMP Group's compensation expense is generally based upon
revenues and can fluctuate materially in any particular quarter,
depending upon the amount and sorts of revenue recognized as well as
other factors. The amount of compensation and benefits expense
recognized in any particular quarter may not be indicative of such
expense in a future period. As a result, the company suggests that
annual results may be the most meaningful gauge for investors in
evaluating the performance of its business.

Cautionary Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements provide JMP Group's current expectations or
forecasts about future events, including beliefs, plans, objectives,
intentions, assumptions and other statements that are not historical
facts; including, but not limited to, 2012 earnings, fourth quarter
performance, market share increases, advisory revenues, extinguishment
of net amortization expense related to liquidity discounts on loans, and
the company's growth initiatives. Forward-looking statements are subject
to known and unknown risks and uncertainties that could cause actual
results to differ materially from those expected or implied by the
forward-looking statements. The company's actual results could differ
materially from those anticipated in forward-looking statements for many
reasons, including the factors described in the sections entitled “Risk
Factors” and “Management's Discussion and Analysis of Financial
Condition and Results of Operations” in the company's Form 10-K for the
year ended December 31, 2011 as filed with the Securities and Exchange
Commission on March 12, 2012 as well as in the similarly captioned
sections of other periodic reports filed by the company under the
Exchange Act. The Form 10-K for the year ended December 31, 2011 and all
other periodic reports are available on JMP Group's website at www.jmpg.com
and on the Securities and Exchange Commission's website at www.sec.gov.
Unless required by law, JMP Group undertakes no obligation to publicly
update or revise any forward-looking statement to reflect circumstances
or events after the date of this press release.

Conference Call

JMP Group will hold a conference call to discuss the results detailed
herein at 10:00 a.m. EDT on Wednesday, October 24, 2012. To participate
in the call, dial (888) 566-6060 (domestic) or (973) 200-3100
(international). The conference identification number is 48859762.

The conference call will also be broadcast live over the Internet and
will be accessible via a link in the investor relations section of the
company's website, at investor.jmpg.com/events.cfm.
The Internet broadcast will be archived and will remain available on the
website for future replay.

About JMP Group

JMP Group Inc. is a full-service investment banking and asset management
firm that provides investment banking, sales and trading, and equity
research services to corporate and institutional clients and alternative
asset management products to institutional and high-net-worth investors.
JMP Group operates through three subsidiaries: JMP Securities, Harvest
Capital Strategies and JMP Credit Advisors. For more information, visit www.jmpg.com.